Correlation Between TOTAL BANGUN and CN YANGTPWR
Can any of the company-specific risk be diversified away by investing in both TOTAL BANGUN and CN YANGTPWR at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining TOTAL BANGUN and CN YANGTPWR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOTAL BANGUN PERSAD and CN YANGTPWR GDR, you can compare the effects of market volatilities on TOTAL BANGUN and CN YANGTPWR and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in TOTAL BANGUN with a short position of CN YANGTPWR. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOTAL BANGUN and CN YANGTPWR.
Diversification Opportunities for TOTAL BANGUN and CN YANGTPWR
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TOTAL and CYZB is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding TOTAL BANGUN PERSAD and CN YANGTPWR GDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN YANGTPWR GDR and TOTAL BANGUN is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on TOTAL BANGUN PERSAD are associated (or correlated) with CN YANGTPWR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN YANGTPWR GDR has no effect on the direction of TOTAL BANGUN i.e., TOTAL BANGUN and CN YANGTPWR go up and down completely randomly.
Pair Corralation between TOTAL BANGUN and CN YANGTPWR
Assuming the 90 days trading horizon TOTAL BANGUN PERSAD is expected to generate 4.79 times more return on investment than CN YANGTPWR. However, TOTAL BANGUN is 4.79 times more volatile than CN YANGTPWR GDR. It trades about 0.07 of its potential returns per unit of risk. CN YANGTPWR GDR is currently generating about 0.04 per unit of risk. If you would invest 1.10 in TOTAL BANGUN PERSAD on September 1, 2024 and sell it today you would earn a total of 2.10 from holding TOTAL BANGUN PERSAD or generate 190.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TOTAL BANGUN PERSAD vs. CN YANGTPWR GDR
Performance |
| Timeline |
| TOTAL BANGUN PERSAD |
| CN YANGTPWR GDR |
TOTAL BANGUN and CN YANGTPWR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TOTAL BANGUN and CN YANGTPWR
The main advantage of trading using opposite TOTAL BANGUN and CN YANGTPWR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOTAL BANGUN position performs unexpectedly, CN YANGTPWR can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CN YANGTPWR will offset losses from the drop in CN YANGTPWR's long position.| TOTAL BANGUN vs. CeoTronics AG | TOTAL BANGUN vs. Calibre Mining Corp | TOTAL BANGUN vs. NEWELL RUBBERMAID | TOTAL BANGUN vs. CEOTRONICS |
| CN YANGTPWR vs. Pick n Pay | CN YANGTPWR vs. Clean Energy Fuels | CN YANGTPWR vs. TFS FINANCIAL | CN YANGTPWR vs. QURATE RETAIL INC |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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